Southampton Ventures Inc.

Southampton Ventures Inc.
Strategic Metals Ltd.

Strategic Metals Ltd.

February 27, 2007 10:09 ET

Southampton Enters Agreement With Strategic Metals to Acquire NiMo Project in Yukon and Southampton Announces $9.6 Million Private Placement

TORONTO, ONTARIO--(CCNMatthews - Feb. 27, 2007) -


Southampton Ventures Inc. (TSX VENTURE:SV)("Southampton") and Strategic Metals Ltd. (TSX VENTURE:SMD)("Strategic") are pleased to announce that they have entered into an agreement in principle whereby Southampton will have the option to earn up to a 100% interest in Strategic's Devonian shale hosted nickel-molybdenum-zinc-platinum group elements ("PGE")(the "Ni-Mo Project").

The terms of the agreement are as follows:

- Southampton has an option to earn 75% of Strategic's 100% interest in the NiMo Project by spending $6 million in exploration by December 31, 2007 and by reimbursing Strategic's costs to date to a maximum of $400,000 in cash and by issuing to Strategic 2,000,000 common shares of Southampton and 1,000,000 common share purchase warrants (the "Purchase Warrants"). The Purchase Warrants entitle Strategic to acquire one common share of Southampton at an exercise price of $1.25 for a period of 24 months from the date of issuance;

- Southampton can earn the additional 25%, for an aggregate 100% ownership of the NiMo Project subject to a 1% net smelter royalty (NSR) in favour of Strategic, by issuing to Strategic an additional 2,000,000 common shares and 1,000,000 common share purchase warrants, at any time before December 31, 2008.

In addition, Southampton is obligated to pay a finder's fee of 200,000 common shares in connection with the acquisition of the project. The option agreement and related transactions remain subject to the execution of a definitive agreement and the approval of the TSX Venture Exchange.

The NiMo Project consists of seven claim blocks totaling 28,905 hectares in north-central Yukon Territory. The properties were recently staked to cover occurrences of Middle Devonian-aged stratiform sedimentary exhalative (sedex) massive sulphide deposits that are enriched in an unusual suite of elements that can include nickel, molybdenum, vanadium, zinc, platinum and palladium.

- The Nick property hosts the original North American discovery of this type of mineralization. Exploration from 1988 to 1992 outlined a bedded deposit around the entire extent of an 80 square kilometer sedimentary basin. Results of 13 diamond drill holes that intersected the sulphide horizon at one end of the basin returned average assays of 3.01% nickel (Ni), 0.20% molybdenum (Mo), 0.82% vanadium (V), 0.82% zinc (Zn), 310 parts per billion (ppb) platinum (Pt) and 150 ppb palladium (Pd) over widths ranging from 2 cm to 10 cm. Exploration by a major mining company identified other areas on the property where significantly thicker accumulations of mineralization were indicated but no follow-up work was ever carried out.

- A 1997 drill hole on the Deer property intersected 25.5 metres of 0.51% Ni and 0.39% Zn, including a 5.3 metre intersection grading 1.37% Ni and 0.70% Zn.

- The Pe and El claims cover two nearby occurrences sampled in 1994 by the Geological Survey of Canada (GSC) but never explored. A 25 cm chip sample across the Pe occurrence assayed 3.96% Ni, 0.27% Mo and 0.81% Zn. A grab sample of a 4 cm massive sulphide horizon on the El claims assayed 3.70% Ni, 0.20% Mo, 210 ppb Pt and 184 ppb Pd.

- The Rich property covers scattered NiMo occurrences reported by the GSC and the Yukon Geological Survey about 80 km along strike of the Pe and El showings. A grab sample of one of these occurrences assayed 4.68% Ni, 0.20% Mo, 290 ppb Pt and 192 ppb Pd.

- The Fox claims were staked to cover strong multi-element stream sediment anomalies from drainages underlain by the host Devonian shales a further 60 km north of the Fox property.

- A sample of NiMo mineralization taken by the GSC in 1994 from the Mon showing assayed 3.30% Ni.

Research by the GSC indicates that the Yukon NiMo mineralization was deposited from warm saline fluids that vented along fault zones on the Devonian seafloor. Modern analogies occur in the Red Sea where thickest accumulations of metaliferous sediment are confined to depressions on the seafloor. Using this model, an aggressive 2007 exploration program of prospecting and geological mapping will accompany stratigraphic diamond drilling to establish the presence of sub-basins where thickest NiMo mineralization may be present on the project properties.

Strategic's management is provided by Archer, Cathro & Associates (1981) Limited, a geological consulting firm with extensive experience in the Yukon, British Columbia and Northwest Territories. Archer, Cathro & Associates (1981) Limited, will remain as geological consultants on the Ni-Mo Project and head up exploration activities for Southampton.

Richard Patricio, President of Southampton, stated, "we are very excited about the potential of this Ni-Mo Project and the geological and area expertise of the Archer Cathro team. In addition, we are planning and extensive and aggressive 2007 exploration program and hope to have a steady flow of results in the second half of 2007."

Southampton is also pleased to announce that it has entered into an agreement with Pacific International Securities Inc. ("PI") to act as its agent to sell, on a private placement basis, up to 6,000,000 Flow Through Units of the Company at a price of $0.85 per Flow Through Unit and up to 6,000,000 Units of the Company at a price of $0.75 per Unit, for aggregate gross proceeds of up to C$9,600,000. All securities issuable under the private placement are subject to a four month hold period from the closing date. Each Flow-Through Unit will consist of one flow-through common share and one half of one non-flow-through common share purchase warrant. Each whole warrant (a "Warrant") will entitle the holder to purchase one additional common share of Southampton at a price of $1.25 for 24 months from the closing date. Each Unit will consist of one common share and one half of one Warrant.

Southampton plans to use the net proceeds from the sale of the Units for exploration and development of the NiMo Project and for general corporate purposes. The proceeds from the sale of the Flow-Through Units will be used for general exploration expenditures, which will constitute Canadian exploration expenses (as defined in the Income Tax Act) and will be renounced for the 2007 taxation year.

Southampton has agreed to pay a commission of 7% in cash or Units, at the election of PI. In addition, Southampton will issue to PI compensation options equal in number to 10% of the aggregate number of Flow-Through Units and Units sold under the offering (including any excessive of the over-allotment option), which will entitled PI to purchase, at an exercise price equal to $0.90, one common share of Southampton for a period of two years.

The offering is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange and the singing of definitive agreements.

Cautionary Statements

This press release contains statements that are "forward-looking". Generally, the words "expect," "intend," "estimate," "will" and similar expressions identify forward-looking statements. By their very nature, forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results, performance or achievements, or that of our industry, to differ materially from those expressed or implied in any of our forward-looking statements. Statements in this press release regarding the Company's business or proposed business, which are not historical facts, are "forward looking" statements that involve risks and uncertainties, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.


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